Skift Travel News Blog

Short stories and posts about the daily news happenings around the travel industry.

Airlines

Colombia to Take New Look at Avianca-Viva Air Merger

1 week ago

Colombia’s civil aviation authority, Aerocivil, is taking a new look at the proposed merger of Avianca and Viva Air following what it described as a “substantial irregularity” in its initial review. That process, which concluded in November, rejected the airlines’ combination due to competition concerns.

Aerocivil notified the airlines Thursday that it would “proceed quickly” to review the proposed deal again. The regulator did not say whether the process would take into account the concessions, including a commitment to keep the Viva brand and giving up slots at Bogotá’s congested El Dorado airport, that Avianca and Viva offered in November.

A Viva Air Airbus A320neo
(Viva Air)

“Staying independent in aviation in the 2020s is not an option,” Viva CEO Felix Antelo said on the importance of the merger in an October interview. “It was hard pre-pandemic. It’s not an option now.”

Avianca and Viva would together operate a 61 percent share of seats in the Colombian market based on 2022 numbers, according to Diio by Cirium schedules. The next largest carrier, Latam Airlines, had a 24 percent share of seats.

The proposed merger is a precursor to a much bigger deal: the combination of Avianca and Brazil’s Gol under the new Abra Group banner. The two airlines plan to maintain separate operations but say the deal would allow them to realize other operational and backoffice synergies, for example placing joint aircraft orders. Abra would be akin to an Air France-KLM or International Airlines Group of South America, and challenge to regional market leader Latam.

Airlines

Colombia Blocks Avianca and Viva Air Merger

3 months ago

The Avianca and Viva Air merger has hit a major roadblock with Colombian authorities objecting to the proposed combination. The move could be a blow to Avianca’s plan to create a pan-South American airline group with Brazil’s Gol.

Colombia’s Civil Aeronautics Authority, or Aerocivil, said Tuesday that the merger of the country’s first and third largest airlines could reduce competition and hurt consumers. It could also increase the barriers faced by competitors in the market. In addition, Aerocivil said the financial situation at Viva Air, which the airline’s claimed required expedited approval of the merger, was not so bad as to “affect its viability in the market.”

An Avianca aircraft in Miami. (ERIC SALARD/Flickr)

“We are concerned about the direction of the decision, as it … ignores the potential effect that the disappearance of Viva would have on users and the market,” Avianca CEO Adrian Neuhauser said in a statement on the decision. “At Avianca, we reiterate our willingness to actively participate in rescuing Viva.”

Avianca first announced plans to acquire Viva Air, but not merge with it, in April. However, in August the airlines requested expedited antitrust approval from Aerocivil for a merger that was “vital for the sustainability and development” of Viva Air. In an October interview, Viva Air CEO Felix Antelo said the airlines planned to continue operate as separate brands but would coordinate schedules and fares in order to offer travelers better flight options.

“It will provide for us a financial muscle way stronger and better than what we had before,” he said. “We are going to keep the [low-cost] model around, we’re going to keep the brand around, [and] we’re going to keep the low fares around.”

Antelo also said that “staying independent in aviation in the 2020s is not an option.”

The Avianca-Viva Air merger is the first step in the creation of Abra, a new South American airline holding company created by the merger of Avianca and Gol. The group also has the option to take at least a 42 percent stake in Chile’s Sky Airline.

Aerocivil said it would reconsider the deal if Avianca and Viva resubmit their merger application and offer “remedies” to boost competition.

Updated with comment from Avianca CEO Adrian Neuhauser

Tourism

Colombia and Peru Only Two Countries Increasing Share of U.S. Inbound Travelers in 2021

9 months ago

This chart below from the United States National Travel and Tourism Office came out this week, and two countries are standout in an otherwise dismal-but-improving 2021 inbound travel market. Colombia is emerging as a force to be reckoned with, as we wrote in detail last month.

CountryArrivalsShareChange from 2020Change from 2019Change in 2021 Rank
Total22,100,453100.00%15.00%-72.20%From 2019
1Mexico10,396,72447.00%52.70%-43.30%↑+1
2Canada2,529,02211.40%-47.40%-87.80%↓ -1
3Colombia1,063,6594.80%293.80%12.70%↑ +10
4United Kingdom460,7492.10%-36.90%-90.40%↓ -1
5India433,3052.00%29.00%-70.60%↑ +5
6Ecuador407,4171.80%140.60%-10.80%↑ +15
7Dominican Republic405,8691.80%127.10%-16.90%↑ +12
8Peru404,9371.80%340.50%22%↑ +20
9Argentina301,7941.40%52.60%-64.70%↑ +6
10Guatemala279,8961.30%249.50%-0.80%↑ +24

Source: U.S. Department of Commerce/ITA/I&A/National Travel and Tourism Office (NTTO)/ADIS/I-94 Program

And the numbers bear that: visitors from Colombia to U.S. were up almost 13 percent from pre-covid 2019 and crossed the one million mark, a huge feat in itself. Peru was the other country, with 22 percent more visitors in 2021 compared to 2019. Shows the growing power of LatAm countries and will make up for some lost tourism business from the likes of increasingly isolationist China, for instance.

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Tags: colombia, peru

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